An opinionated look at current events, culture and faith, since 2005 telling you what to think and why to think it about everything that really matters.

Saturday, September 11, 2010

Business Climate, Viewed from a Lofty Height

Here are a couple of quotes regarding the present business climate from a report on a meeting of extremely wealthy individuals convened by the Blackstone Group, as reported by CNBC's John Melloy:

"They saw the United States in a long-term slow growth environment with the near-term risk of recession quite real," said [Byron] Wien, in a commentary to Blackstone clients. "The Obama administration was viewed as hostile to business and that discouraged both hiring and investment. Companies and entrepreneurs were reluctant to add workers because they didn’t know what their healthcare costs or taxes were going to be." . . .

"The economic pessimism expressed by the wealthy is completely understandable," said Jim Iuorio, a trader with TJM Institutional Services. "From the start of the campaign that led up to the ‘08 election, the wealthy have been depicted as villains by the Democratic party. Even though the political tide seems to be turning, real change is months or years away."

This situation is not without its precedents, as the sublime Amity Shlaes pointed out recently and yet again in response to the ridiculous Paul Krugman's monotonous drumbeat for fabulous federal spending increases. In sum, FDR's war on business prolonged the Great Depression, and ending it ended the Great Depression.

Remembering that one of FDR's most counterproductive moves was enacting a tax on undistributed corporate profits--to force "greedy" corporations to spend the money that they were holding against the uncertainties created by his own policies and rhetoric--gives one pause today.

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